Fund Strategies and Market Commentaries
As of January 20, 2015

Midas Magic: To seek its investment objective of capital appreciation, Midas Magic is focusing primarily on large companies, with a broad orientation towards conservatively priced value stocks and aggressively priced growth issues.  The Fund’s portfolio companies are mostly based in North America, but typically enjoy global operations with attractive returns on assets.  Recent top performing holdings are those engaged in asset management and banking, while lagging oil and gas company shares were sold. The Fund’s overall portfolio, as compared with the S&P 500, has a heavy weighting towards financial services, and less to economically sensitive industries such as energy and basic industries, in view of the potential for disappointing U.S. growth and employment trends following the collapse of energy prices.  Through the first quarter of the year, the Fund anticipates maintaining a leveraged investment position in quality companies.

Midas Fund’s core strategy is to seek investments in higher quality senior and intermediate producers of precious metals and other natural resources.  Companies the Fund anticipates adding to its portfolio will normally be those with promising exploration potential, expanding production profiles, increasing cash flow, and/or other special growth features.   Outstanding performers in the Fund portfolio have recently included Osisko Gold Royalties Ltd. and Detour Gold Corp., although the fall of oil to below $50 per barrel has negatively affected the returns of the Fund’s holdings of BHP Billiton Ltd, one of the world’s largest mining companies, and other natural resource companies with energy exposure.  Currently holding some reserves in cash, Midas Fund may seek to re-position its portfolio in view of recent positive gold market action by adding to some current stockholding and introducing new names into the portfolio.

Midas Perpetual Portfolio’s investment objective is to preserve and increase the purchasing power value of its shares over the long term using a core “asset allocation” strategy.  To the extent consistent with tax planning and lower levels of portfolio turnover, the Fund seeks to hold a target percentage of its total assets in each of the following categories: gold, silver, Swiss franc assets, hard asset securities, and large capitalization growth stocks.  From time to time, the Fund may use leverage to increase its investment in large capitalization growth stock.  In the recent period, the Fund added leverage to the portfolio with an increased allocation to large capitalization growth stocks, such as Merck & Co., Inc. and Twenty-First Century Fox Inc. Class A, which have performed well.  While its hard asset securities of mining companies have underperformed, the Fund has benefited from its allocations to gold and silver, as well as from Swiss franc assets, due to the volatile but positive price movements in those sectors.



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